GOP Disputes Suggestion Foreign Funds Used in Campaign

Republicans and GOP allies are hitting back at suggestions by President Barack Obama and the Democratic National Committee that they are using foreign money illegally in the campaign.

Democratic officials are targeting the U.S. Chamber of Commerce and other groups, calling on them to disclose the source of their political donations.

The Chamber has repeatedly denied that its $75 million campaign war chest contains any foreign funds, and the White House acknowledges that it has no proof that the Chamber or other groups are spending foreign nationals' money on political ads or campaign activities.

Such spending would place the foreign donor and the group that spent the money in violation of federal law.

Mr. Obama raised the issue at a campaign rally last week, where he said that "groups that receive foreign money are spending huge sums to influence American elections.''

This weekend, the DNC began running a television ad targeting the Chamber, as well as Republican strategist Karl Rove and former Republican National Committee Chairman Ed Gillespie. Messrs. Rove and Gillespie advise two large groups supporting GOP candidates with millions of dollars in political ads this year.

"It appears they've even taken secret foreign money to influence our elections,'' the Democratic Party ad says. "It's incredible: Republicans benefiting from secret foreign money.'' A DNC spokesman declined to say how much money was being spent to broadcast the ad.

Chamber spokesman Tom Collamore called the ad "ridiculous and false." The Chamber says that foreign firms contribute about $100,000 to its more than $200 million operating budget. Chamber officials said the foreign money is used for international programs, not U.S. campaigns.

Appearing on Fox News Sunday, Mr. Rove said the president and DNC had accused him and Mr. Gillespie of "a criminal violation...and they have not one shred of evidence to back up that baseless lie. This is a desperate and, I think, disturbing trend by the president...to tar his political adversaries."

Under the law, certain nonprofit groups don't have to disclose donors' identity. The nondisclosure rule applies to the Chamber and other entities, such as Crossroads GPS, one of the groups advised by Messrs. Rove and Gillespie.

President Obama and some Democratic lawmakers have said the source of those donations should be disclosed, and that the lack of disclosure raises questions about the source of the money.

Top White House political adviser David Axelrod defended Democrats' new assertions about foreign money Sunday on CBS's "Face the Nation." Asked by host Bob Schieffer whether the White House had proof that foreign spending would be "more than peanuts," Mr. Axelrod asked Mr. Schieffer: "Well do you have any evidence that it's not? The fact is that the Chamber has asserted that, but they won't release any information about where their campaign money is coming from. And that's at the core of the problem here."

Independent campaign expenditures by U.S.-based subsidiaries of foreign firms are legal, as long as all decision-making on the spending is done by U.S. citizens and is not coordinated with a campaign or candidate. More than 100 overseas corporations with U.S. subsidiaries maintain political action committees, according to federal filings.

Mr. Obama faced charges of potential foreign influence during his presidential campaign in 2008, when Republicans said his reliance on hundreds of millions of dollars in small contributions made it hard to tell whether foreign money was flowing into his presidential campaign. Candidates are not required to disclose a donor's name unless he or she contributes more than $200 in a calendar year.

The Service Employees International Union, one of the nation's fastest-growing labor unions, acknowledges that it can't be certain that foreign nationals haven't contributed to its $44 million political budget to support pro-labor Democrats.

The SEIU says that political dues from Canadian members are kept separate and the union asks its 300,000 U.S. political action committee contributors whether they are U.S. citizens but doesn't require proof.

Such methods are "not good enough," says Kenneth Gross, a campaign-finance lawyer at Skadden, Arps in Washington. "A union can't just solicit workers in the U.S. and hope for the best. Additional steps need to be taken to ensure that foreign citizens who do not hold green cards are not contributing," he said.

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